Questions of Cash: Halifax call centres never called back about my lost £5,000 bond

Q I am extremely unhappy with Halifax and Halifax Life. In 1998 I transferred £5,000 from my bonus gold account to a five-year guaranteed investment bond, with details entered into my passbook.

When it matured, I tried to withdraw the money for a deposit on my first home. It took Halifax Life a week to find what it had done with my money and they traced it only after numerous phone calls and meetings with me.

Its call centres are inefficient and repeatedly did not phone me back as promised. Amazingly, it turned out that my money had been deposited into someone else's account. RE, Bristol.

Halifax admits your plan details were transposed to those of another customer. As compensation, it is sending you £75 which includes a payment for loss of interest.

We have several letters complaining about service standards at HBOS (the merged Halifax/Bank of Scotland), but a spokesman for it says: "From our own statistics we have not seen any appreciable change in the total number of complaints we receive."

We would be pleased to hear from other readers about the bank's service, in particular at the performance of its call centres, which appear to annoy some customers.

Q A few weeks ago (Questions of Cash, 5 April 2003) you answered my question about my guaranteed no-claims bonus from Liverpool Victoria, confirming I would not lose this if I claimed for a car accident. Despite this, their call centre still insists my premiums will rise if I claim. AB, Tiverton

Your no-claims bonus is guaranteed and you will not lose it. But claims experience does affect the premiums you are charged. The cost of insurance can, therefore, still rise though the no-claims bonus remains the same. That is what Liverpool Victoria's call centre was trying to explain to you.

But in your case a claim would not have led to a premium increase and you were wrongly advised by the call centre not to claim. On this basis Liverpool Victoria is fully reimbursing you the cost of your car repair, £180, without you submitting a claim or having to meet the standard £100 excess laid down in your policy.

Q What are stakeholder pensions and how do I find out about them? JL, Birmingham.

Stakeholder pensions are low-cost, flexible pensions designed by the Government to encourage more people to invest for retirement. Management fees are capped at 1 per cent of the value of your pension fund. There are no penalties for moving money in or out, changing contribution arrangements or retiring early. Individual contributions can be as small as £20, up to a maximum of £3,600 per year, or more.

Stakeholders are additional to the state pension and state second pension (formerly Serps) and an alternative to occupational and personal penessentially designed for people earning between £10,000 and £20,000, but may be suitable for others, including non-working carers (such as housewives) and low earners if they have the cash to invest.

They can also be a tax-efficient means of donating to children if you are interested in very long-term financial planning. Most major banks and other financial product providers offer stakeholders, but for more information you should contact a financial adviser, preferably one who has passed the pensions paper on their qualification.

Several websites, including those of government departments, provide more information and a starting point is www.inlandrevenue.gov.uk/ stakepension/.

Q My Equitable Life retirement annuity plan matures this year with a guaranteed value of £26,500. I do not need to draw an income yet. I understand I can buy an annuity from Equitable or another company but I need something which can be activated within, say, a month and I have been told that a stakeholder pension offers this facility. VG, Diss.

Peter Miller, pensions specialist at advisers Hacker Young, says: "You appear to have a retirement annuity plan with Equitable Life that will have a value at maturity of £26,500 "if guaranteed terms apply". This means £26,500 would be available if pension benefits were being secured. Pension benefits can be secured by either the purchase of an annuity or by the establishment of a personal pension withdrawal plan (drawdown) with either Equitable Life or an alternative pension provider.

"Guaranteed terms do not apply if the pension fund is simply transferred out of the with-profits fund to an Equitable Life unit-linked fund or to another pension provider. If guaranteed terms were not applicable, an 11.1 per cent penalty would be applied to the fund value on transfer. This penalty would be applied even if the stated retirement age on the contract had passed.

"The earliest a policyholder can draw the benefits from a retirement annuity plan is their 60th birthday. After that, a policy holder is free to buy an annuity at any time. There should be no undue delay in establishing an annuity with either Equitable Life or an alternative annuity provider.

"A personal pension withdrawal plan would not be a viable alternative in this case because it has relatively high fixed costs. Your pension fund can be used to purchase an annuity at any time after the age of 60 without penalty, which appears to provide the flexibility you are seeking.

"Transferring to a stakeholder pension would not provide additional flexibility as far as annuity purchase is concerned and transferring from Equitable Life without securing pension benefits immediately would result in an 11.1 per cent penalty being incurred."

If you have questions about personal finance, write to Questions of Cash, 'The Independent', 191 Marsh Wall, London E14 9RS, or e-mail cash@independent.co.uk. We regret that we can reply only to letters published here. Please send copies, not originals, as we cannot return material.